Driving for Advanced Analytics with Joe Brandenburg Operational and Market Data Analytics
Driving forAdvanced Analytics
with Joe Brandenburg
Operational and
MarketData Analytics
Long-TermProfitability
Advanced
Analytics
Tracking
and
Targeting
YOU
ARE H
ERE
Oper
ation
al
Trac
king
and
Scor
ing
The First Step in “Solving” is “Knowing” what the issues Are!!!
Then Finding way to Improve
Building the “Knowing”
Background and Capabilities
ITProgramming, Project
Management andReporting and Analytics
Tool Design12 years
Accounting, Actuarial and FinanceReporting, Process Development and Management
Reporting11 Years Financial Services
9 Years Personal Lines5 Years PNC
3 Years Health
Marketing and StrategyResearch – Marketing, Competitive Intelligence, Analytic
Modeling, Pricing11 Years
Leadership and Mentoring
8 years direct management and 12
years project leadership
Analytics
Background
Technical Capabilities
• Programming SAS Mainframe and PC SAS for 12 years hands-on, JCL, JES2, Sync sort
• Excel complex from Pivot tables to the Solver• MS Access, Word, PowerPoint• SQL Server, Oracle, Sybase 12 years
– Database design, normalization, stored procedures, DTS, analysis services
– Indexes, and optimization
Ability to Sell the Right Mix of Support, Analytics, Research, and Analysis
• Typical Tactic is to offer support and provide request fulfillment and then go beyond to show additional opportunity and insight through Analytics, Research and Analysis in a teaching and partnership fashion
•Ability to speak to and work with all areas from spending time in and with all areas front to back in financial services organizations
Analytic Capability Framework
Custom ResearchConcept Tests (Quant or Qual)Key Driver AnalysisConjoint Analysis and Consumer
Preference (Product Design, Ad Copy, pricing,
segmentation, forecasting)Customer Satisfaction (Loyalty,
Defection, Net Promoter)Simulated Test MarketsBrand Equity and Brand
Assessment Uniqueness, Attractiveness,
Relevance, Credibility Promotion, Channel, Web Metrics
Customer and Product Profitability(CLV, Persistency, and Activity Based Costing)
Pricing (Risk, Market Based, Elasticity)
Acquisition Costs and Retention Costs
NPV, IRR, ROI, Payback PeriodUnderwriting performance
and results tracking
Marketing Financial
Analytic and Research
Objectives (Examples)
Increase P&C Sales by market expansion, channel development 25%
Improve Customer Satisfaction to 95%
Reduce Churn by 18%
Develop product packages, up-sell and cross-sell tactics
How Do I improve my Customer
Satisfaction?
When should I contact
customers and what message to get them to stay?
What Products and
Combinations do people want?
Where is there opportunity for me to expand?
How can we get there?
Building a Strategy of Attack
Building a Strategy of Attack• Phase I: Development of Baseline
– Determine low hanging fruit: Easy low cost changes that will have big impact to the business
• Phase II: Integration of Baseline, Outside Data and New Collection Methods
• Phase III: Building tools to influence market expansion, automation, product design and pricing changes
• Phase IV: Measure results of company efforts through reporting, dashboards and developed algorithms
Phase I: Development of Baseline
Evaluating the BusinessDevelopment and Potential
Phase I: Development of Baseline
– Current Reporting Capability, Models, Data and SWOT• Operational Analytics Reviews
– Underwriting, Accounting (Statutory and GAAP), Pricing, Reserving (Case and IBNR)
– Development of automation and key profitability driver models– Evaluation of demographics and geo-demographic factors that
impact retention, messaging and best customers (High Value/Low carrying cost)
• Marketing Analytic Reviews– Competitor Pricing, Product Designs, Placement, and Promotion– Key Purchase Drivers of customers (price, deductible, ect)– Broker Network - What do we know? / What do we believe?– Product Expansion and Market Expansion Opportunities
» Expansion through acquisition or evaluation
Process Review and
Documentation
Manual Process Short-Term Automation
Process Automation
Example of Evaluating the Business Potentials
Market Assessment and Potential
16
300MillionPeople In The US
Market Assessment and Potential
US Market
XXXMillionPotential Buyers of Auto Insurance and Businesses buying PNC
Low Potential
Medium Potential
High Potential
Current States
Market Penetration – Where We Have Won!
18
Different Penetration For Different Markets
Phase II: Integration of Baseline and Outside Data
Building Reports and
Business Intelligence
20Integrating Business Intelligence Tools into the Mix and
Working with IT to develop new tracking tools and finding data
BUSINESSINTELLEGENCEDATAMART
Research Study TraceBack
Competitive Intelligence(Pricing)
Dunn and Bradstreet(Business / Employment Review)
Census Population Survey(CPS Supplemental Annual)
Yankolovich(Attitudinal Segmentation)
EDW
CI FeedsHPS Supplied Information
Call Center(Symposium)
So-Easi(Underwriting Database)
HPS Enrollment File
ARMS(Agent Relationship
Database)
Commissions(Agent Costs Paid)
Indy DatabaseDirect Sales Engine
EDGE Scheduler
Sales Funnel
Database Extract
AM Best Books CD(Statutory Extracts)
Need to BuildInformation in a
Database
Pricing Grid
Renewal Rates
Network Contracts Database
Outside Source Market Opportunity
Claims
Reporting / DataMining /Product
Development
Pricing and Experience EDW
Reporting ToolsSAS
Business ObjectsCrystal Reports
Corporate UW Database
MeetingsScheduled
John Morgan andAdam Singleton
Reporting andMetrics
New Products
DashboardsProduct ResultsDiscovery
Sale Interest Results
Rate Calculator
AWB Coremetrics
Plan Pointer
CDC - National Health InsuranceSurvey
Solar
Examples of Analytics, Reporting and Forecast
Reporting and Tracking• Building Reporting and Outside Forces • (Dunn and Bradstreet, Equifax, Experian 4 digit Zip Code data, Retention
History, Claims Patterns
Summary, Reporting, Forecast, Optimization
Detail – Policy and ClaimData mining for Patterns
Transactional – opportunity and
validation
Lifetime Value
Persistency
High Value Customers - Products
Phase III: Building tools to influence market expansion, product design and pricing changes
Examples
Underwriting Automation• Establish baseline of underwriting
standards• If exists, take underwriting answers
and compare to claims and persistency
• Use of standardizations, skip patterns and question piping to populate underwriting database and decision engine
Q1Result 1
Rate Up
Approve
Result 2 Decline
SPHERE OF
INFLUENCE
Customer Independent Broker
Receptivity
Penetration Potential
Carrier Reputation
Fair Share
Build Profiles
Retention Renewal Tactics
Demographics Socioeconomic Perception
High Value Customer Evaluation
Claims experience
Net Promoter
Attitude / Awareness /
Net Promoter
Build Profiles
CRM and Quote Profiling Tools Online and Offline
CRM Agent Recruitment Tracking Quoting tool tracking using Coremetrics, XML and
SQL Server for both Online and Offline Tools
• Qualifying Does lead meet standards• Certified (Trained) Current on product• Committed Specific volume commitment to
contract production• Engaged Merits our active support and
enrollment into our programs
• Reach• How big of a geographic circle does this agent
reach?• Customers• General, Auto Targets, PNC Targets• Partnership• Differing depths measures of ‘engaged’;
beyond ‘charter’ designation• Other• ARMS is a tool for lots of coordination
opportunities. Links to D2C and Wholesalers
Manage Agents by Sales Stage(ARMS)
Future: Enhance Agent Profiling(ARMS)
26Note: Initial ARMS “Status” designation has been established. This will “roll-up” in both Field Sales reporting and on the Operational “Dashboard”.
B2B Recruitment
Phase IV: Measure results of company efforts through reporting,
dashboards and developed algorithms
Campaign Follow-up
Customer Retention Development
Campaign Segmentation
New Sales Development
Results and Action Plan Follow-up